What's in Store for Alternative Fuels?

By Chris on July 2, 2010

A recently published piece from Seeking Alpha asked, “Will the BP Tragedy Spur Faster Adoption of Biofuels?” Apologies for spoiling the ending, but the article concludes that there is limited investment from the US government to spur any near-term embrace of biofuels or petroleum alternatives.

While the author’s concluding statement may or may not be true, there is considerable innovation and activity ongoing in the world of alternative fuels (including significant efforts from some big name oil companies).

Peering into the future alternative fuels landscape using media analytics from Recorded Future we can research momentum on different fuel technologies, observe plans for industry growth and identify regulations or new ventures that may tilt the current balance that remains heavily in favor of petroleum.

Current Outlook

Using our temporal analytics engine, we can take a cursory glance at the future for biofuels. We observe a moderate level of momentum through the end of 2012 before events trail off through the middle portion of the decade.

Once we have an idea of the future for biofuels based on the above timeline, we can compare that to a view of the future for “petroleum refining” over the same period. The events represented in red indicate a negative sentiment recognized in the material.

Future for the Petroleum Refining Industry

Shifting Focus of Biofuels

Part of the disparate news coverage around biofuels may come from its scattered focus. While corn ethanol was initially the darling of the alternative fuel race, an understanding seems to have been reached that there will be need for much beyond corn-based solutions.

The timeline below shows a quotation from U.S. Secretary of Agriculture Tom Vilsack saying, “Corn-based ethanol will continue to be part of the solution but by no means the only way to produce ethanol.”

Corn-based Ethanol over the Last 12 Months

Still, while ethanol remains very much in public interest according to search (seen below), it is curious to see a slight decrease in media coverage related to alternatives despite the furor surrounding offshore drilling and petroleum after BP’s oil rig explosion.

Comparison of alternative fuels search interest and media coverage

It will be interesting to follow news analytics measuring the momentum and sentiment related to petroleum alternatives as the US government and the energy industry formulate their paths forward from the Gulf oil spill.

Below we see a commentary from the science blog Oscillator saying, “Biofuels right now cannot compete with the oil industry in efficiency and production, but biotechnology hasn’t had a Chernobyl or a Deepwater Horizon.”

Biofuels Since the Deepwater Horizon Spill

Curious about how BP’s competitors will react the the spill and position their research and development partnerships, we consider just one of the possibilities by searching for business affiliations over the last 12 months related to Exxon Mobil.

Here find business alliances between Exxon Mobil, which has reportedly invested in and partnered with Synthetic Genomics, as well as Chevron, which has a partnership with Solazyme.

ExxonMobil Partnership with Synthetic Genomics

Will these long time oil players continue to position themselves as alternative fuel friendly?

Outside of these “traditional” fuel stakeholders, we can also look at the relationships established by biofuel companies such as PetroSun where we discover the arrangement of an algae-to-biofuels pilot program set up in the town of Gilbert, Arizona.

Down the Road

In establishing a big picture view of the alternative fuels landscape, it will also be valuable to recognize government regulations and legislation that may impact the fuel industry.

Looking at temporal data indicating events in the “Far Future,” we see that United States Environmental Protection Agency regulations will limit the use of petroleum and corn-based ethanol while mandating renewable fuel production of 36 billion gallons annually.

The Far Future for Biofuels

Another way to research the future for biofuels would be to explore associations and events within the general industry of “biofuels” set to take place anytime in the future. Below we see critical locations (Washington, Brazil), industry players (Exxon Mobil, Shell, Boeing) and key public figures (Bob Dinneen – President and CEO of the Renewable Fuels Association).

Future of Biofuels Network

What to Watch For

It’s seems inevitable that drastic changes are in store for petroleum industry, and that alternatives such as biofuels may be a major competitive market entry. We didn’t even touch on the developing electric car industry or maybe cultural shifts away from personal vehicles altogether.

The emergence of biofuels will depend on a number of the factors that can be observed using Recorded Future’s temporal analytics including:

Public acceptance through blog commentary and sentiment analysis

Commercial developments, partnerships and investment

Early recognition and planning for government regulations enabling market growth or inhibiting petroleum production

Anybody think that using temporal analytics we can target when the biofuels industry may break into the mainstream? Or recognize that biofuels will stall out and another alternative is going to pose a greater challenge to petroleum?